Step 1: Install the following:

GOM Player (will be used to capture screenshots) If you have another program that supports  capturing screenshots, that’s okay.
http://player.gomlab.com/eng/download/ 
 

Photoscape This programs will help you edit many photos at once, or one at a time, and put the screenshots together to form the actual GIF.
http://www.photoscape.org/ps/main/index.php 
 

Youtube Downloader (optional)
http://www.chromeextensions.org/utilities/chrome-youtube-downloader/  

Step 2: Use the youtube downloader, or download a film/show of your choice. Open it in GOM Player.

Step 3: Pause the film just a second before the part you want as the GIF. Then, open the control panel. It’s the little button that looks like a fork underneath the sound equalizer. When the control panel has opened, click the word “screen capture”. Do it slowly to make sure you get every screen shot that you want to use in your GIF. As an alternative, you can click CTRL+E. Your screenshots will be saved into a folder on your computer.

Step 4:  This step is OPTIONAL, it is only a few tips on batch editing the screenshots. Open photoscape. Go to the batch editor tab on the top of the photoscape menu. Find the folder that contains your screenshots from GOM Player on the right side. Drag all of the screenshots to the white bar on the top. Go to “filter” and just play around with the different options. Here you can change the contrasts, the overall lighting and even some color effects.

You can also change the canvas size. Where it says “Original Size” I personally change it to crop. And put the width size to 498, and have the height in between 240-280.

If you want to add a watermark, go to object and put a checkmark on one of the text boxes. Click on convert all when you are happy with your new screenshots. They will be saved into a new folder. 

Step 5: Go to the animated gif tab on photoscape. Drag all of your screenshots into the white bar. You can change the time, and the size of the gif . ALWAYS REMEMBER: Your gifs must be under the canvas size of 500x500 and it has to be under 1 MB. OTHERWISE THEY WILL NOT WORK ON TUMBLR. On average a gif can have between 10-19 screenshots without overexceeding 1 MB. It just depends on the colors, contrast etc. You just need to play around with those things until it works, or delete some of the screenshots. 

Step 6: Save the Gif, and upload to tumblr!! :)